Rio Tinto Extends Riversdale Bid, Again

Rio Tinto said on Monday that it would extend its $3.9 billion offer for Riversdale Mining of Australia for three days as it attempts to rally Riversdale shareholders to its bid.

It is the latest extension of the offer, pushing the deadline to April 6.

“The additional time would allow some market participants to finalize the unwinding of equity swaps and to settle trades that have occurred on the Australian Securities Exchange before they can accept,” Rio Tinto said.

More than a third of the shareholders have tendered their shares, the company said in a separate announcement, with 34.94 percent having accepted as of Monday, up from 33.04 percent last week.

While deal may be gathering momentum, it has been slow over all, which has led Rio Tinto to extend the offer twice now. It has also raised its bid once, from 16 Australian dollars to 16.50 dollars a share. Riversdale’s board has recommended what Rio Tinto has called its final offer, but shareholders see little reason not to push the deadline in hopes of another increase.

Meanwhile, no credible rival bid has emerged. But Riversdale’s two largest shareholders, the steel makers Tata Steel of India and Companhia Siderúrgica Nacional of Brazil have increased their interests, as they seek to maintain supply agreements from Riversdale’s mines in Africa.

Riversdale, listed in Australia, operates largely in Mozambique, producing coking coal essential to the steel-making process. Its vast Benga project is estimated to hold billions of tons of coal, and has drawn the avid eye of resource companies all over the world.

Together the two shareholders own 47 percent of Riversdale, and Rio Tinto needs 50 percent to complete its takeover. In theory, all of Riversdale’s other shareholders would have to accept the Rio bid for it to pass, unless the approval of the two steel makers is secured.

It is more likely, according to a person with knowledge of the situation, that Tata or Siderúrgica Nacional will cede some part of their stake once they are sufficiently reassured by Rio Tinto that they will have access to the coal.

If the bid fails altogether, Riversdale has said it would seek to finance its mining projects by raising capital on the bond market.

Riversdale shares slipped 0.04 Australian dollars, or 0.25 percent, to 15.75 dollars in Sydney on Monday.